Tag: Financial Results
MTN Group today reported a very strong set of operational and financial results for 2020, displaying business resilience under COVID-19 pressures and a challenging macroeconomic environment. Africa’s leading mobile operator also announced its re-positioned strategy – Ambition 2025 – to accelerate growth and unlock the value of its infrastructure assets and platforms.
The Group added 29 million subscribers in the year, to reach a total of 280 million across 21 markets. It reported a 52% increase in adjusted headline earnings per share, a four-percentage point increase in return on equity to 17% and a more than doubling in operating cashflow to R28,3 billion.
“We continued to perform favourably against our medium-term targets,” said President and Chief Executive Officer Ralph Mupita. “In constant currency terms, service revenue grew 11,9% to R170 billion and EBITDA increased by 13,4%, maintaining our strong operating leverage. The Group’s EBITDA margin improved by 0,9pp to 42,7%, benefiting from the execution of our expense efficiency programme.”
The solid results were supported by pleasing growth in MTN’s larger operations as well as a broad-based improvement across all regions.
The Group continued to prioritise the health and safety of its people and mourned the loss of 10 MTN employees to COVID-19, after reporting a total of 1 404 infections in the period to the end of February 2021.
“We are pleased to have made a $25 million donation in support of the African Union’s programme to secure much-needed COVID-19 vaccines,” said Ralph. “This partnership deepens MTN’s role in the ongoing work to save lives in the markets in which we operate. Importantly, it aligns with our ambition to create shared value and ensure the continent’s future progress and prosperity.”
As well as managing the risks of COVID-19, the Group remains alive to the opportunities presented by the pandemic, particularly the accelerated need for digitalisation evidenced in the greater adoption and usage of MTN services. In 2020, MTN added 19 million data users and almost 12 million MoMo users, to reach totals of over 114 million and 46 million respectively. The Group’s networks remained well-invested, with capex of R28,6 billion in 2020 and headroom to accommodate growth of more than 110% in data traffic in the year.
In the near-term, MTN is focused on de-leveraging the holding company and it reduced net debt by R12 billion, to R43 billion. The leverage ratio for the year, however, remained flat at 2,2x as cash upstreaming from Nigeria remained challenged. MTN concluded R4,3 billion of realisations of its asset realisation programme (ARP) and remains focused on completing some of its larger transactions, which did not proceed in the year due to challenging market conditions.
In this regard, MTN suspended the final dividend for 2020 due its near-term focus on faster de-leveraging of its holding company as well as three conditions which negatively impacted this objective. These related to uncertainties around cash upstreaming from Nigeria, the timing of ARP proceeds and COVID-19 impacts.
“In light of these material uncertainties, the Board has also suspended the dividend policy and anticipates communicating a revised medium-term dividend policy when we announce our 2021 results in March 2022,” said Ralph.
During this transition, the Board anticipates paying a total ordinary dividend of at least 260 cents per share for the 2021 financial year. Ralph added, “on assessment of the progress of cash upstreaming from Nigeria, ARP delivery and COVID-19 impacts, the Board will consider returning further cash to shareholders in the form of special dividends or share repurchases after the release of 2021 results.”
MTN also announced a revised strategy. “Further to our previous announcement regarding our intention to focus on our pan-Africa strategy, we completed a comprehensive strategy review in Q4 2020 and are excited to introduce ‘Ambition 2025’,” he said. “As part of this strategic repositioning, we are looking to structurally separate our infrastructure assets and platforms, such as fintech, to reveal value and attract third-party capital and partnerships into these businesses, over the medium-term.”
“Going forward, we believe that Ambition 2025 will position the business to capture the exciting opportunities across our markets and our medium-term guidance has been enhanced to reflect this accelerating growth outlook. To support this, we plan to invest approximately R29,1 billion in our network, fintech and digital services platforms in 2021.”
MTN Group on Friday announced a strong set of financial results for the third quarter, supported by the performance of its larger operations in South Africa, Nigeria and Ghana, and good group-wide growth in subscriber numbers despite challenging trading conditions which have taken a toll on people everywhere.
“As the COVID-19 pandemic has continued to impact lives and livelihoods across our markets, the group has demonstrated strong operational execution and resilience,” said MTN Group president and chief executive officer Ralph Mupita.
To meet the increase in data and digital usage, he added that MTN had focused its investment on network capacity and resilience and modernising its IT systems, spending R16 billion in the year to the end of the third quarter.
Service revenue grew by 11,4% to more than R43 billion. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 13,9% and the group EBITDA margin widened by 1,4 percentage points to 43,3%, in line with medium-term targets.
“We recorded solid growth in voice revenue of 3,9%, which reflects an encouraging recovery supported by the easing of lockdown restrictions,” said Mupita. “Data revenue grew by 31,9%, bolstered by increased demand for work-from-home services, digital entertainment as well as online education offerings.”
The group also reported growth of 21,0% in fintech revenue and 37,5% in digital revenue, driven by the increased adoption and usage of digital offerings.
In the quarter, MTN added 12 million subscribers to reach a total of 273 million across 21 markets, as well as adding 5,3 million active data users to 107 million. In our work to enable greater financial inclusion, we reached a significant milestone by surpassing the 40 million MTN Mobile Money (MoMo) user mark, an addition of 3,5 million in the quarter to 41,8 million at end-September.
“Apart from greater adoption brought on by COVID-19, more people used MoMo because of enhancements to the functionality of the MoMo app, the large increase in registered MoMo agents, as well as the integration of MoMo into our instant messaging platform Ayoba in some of our markets,” said Mupita.
MTN South Africa performed particularly well, sustaining its turnaround, with an acceleration in its core consumer and enterprise business units. MTN Nigeria recorded a solid result with some recovery in revenue growth under difficult operating conditions, and MTN Ghana delivered another good performance.
As part of its asset realisation programme, MTN Group completed its exit from its 18,9% investment in e-commerce venture Jumia as well as the localisation of an 8% shareholding in MTN Zambia, realising net proceeds of approximately R2,3 billion and R204 million respectively.
Looking ahead, Mupita said the group remained focused on managing the impacts of the COVID-19 pandemic on its staff, customers, networks and the balance sheet and liquidity profile of the group. Through its Y’ello Hope initiative, it would continue to support those stakeholders who have been particularly hard hit by the pandemic.
“Despite the relaxation of lockdown restrictions, the operating environment remains challenging and uncertain. We will continue to build on our operational and financial resilience. We have now increased our full year forecast for capital expenditure to R26 billion, to ensure that our networks provide reliable connectivity and digital services to all of our 273 million-and-growing subscriber base,” he said.
MTN Group today reported encouraging results for the first half of 2020, navigating well through the economic crisis brought on by COVID-19.
MTN reported service revenue growth of 9,4% to R80 billion and EBITDA growth of 10,9% to R42 billion as efficiency initiatives saw its profit margins continue to improve. Headline earnings per share after non-operational impacts grew by 54%, operating free cash flow increased by 117,8% and ROE improved further to 14,1%.
“MTN’s first half performance affirmed the resilience of our people and business model as we delivered strong results against the backdrop of unprecedented socio- and macroeconomic uncertainty and challenges,” said MTN Group president and chief executive officer Rob Shuter.
“As we navigate the pandemic and its effects, we have prioritised looking after our people, customers and networks while focusing on efficiencies,” he said, adding that work-from-home programmes continue for MTN staff; Y’ello Hope Packages are helping ease customers’ financial pressures; and MTN’s support for various other initiatives aims to limit the impact of COVID-19 on society.
MTN also announced it was focusing its strategy in future on the African markets: “As part of our ongoing portfolio review, we believe the group is best served to focus in the future on our pan-African strategy. We will therefore be exiting the Middle East in an orderly manner over the medium term. As a first step we are in advanced discussions to sell our 75% stake in MTN Syria,” said Shuter.
Inspired by the group’s belief that everyone deserves the benefits of a modern connected life, MTN added 11 million subscribers in the first six months of the year to reach a total base of 262 million. By end June 2020, MTN had 102 million active data users and 38 million active Mobile Money users.
Despite lockdown restrictions impacting network rollout, MTN Group invested R10 billion in capital expenditure across our markets and brought a further 54 million people into 3G and 4G coverage. The focus on affordability of data saw the average rate per megabyte reduced by 34%.
The group made progress on the asset realisation programme, concluding the disposal of the tower company investments in Ghana and Uganda for R8,8 billion.
MTN did not declare an interim dividend given the continued uncertain impact of COVID-19 on the operating environment but will consider a final dividend should conditions warrant.
“While we expect the remainder of the year to be shaped by the ongoing challenges presented by the pandemic, we believe that MTN will remain comparatively resilient and is poised to sustain its growth over the medium term,” said Shuter.
MTN Group today announced a positive service revenue trajectory in the first quarter financial results for the year ended 31 March 2020
Speaking on the results MTN Group president and CEO, Rob Shuter said: “The effects of the COVID-19 pandemic on the global economy have brought about unprecedented uncertainty, volatility and challenges which are impacting our markets at both the socio-economic and macro-economic levels. The impact of the pandemic on our quarter one performance was not significant as lockdown restrictions for our consolidated subsidiaries were only implemented from the last week of March 2020.
We continued to build commercial momentum adding 6,6 million subscribers in the quarter, with active data users increasing by 2,9 million and MoMo subscribers by 0,4 million. We continued to scale our Ayoba platform recording 2,6 million monthly active users. We accelerated our MoMo agency network in Nigeria, under our super-agent licence, adding 70 000 agents in the first quarter, bringing the total number of registered agents to 178 000.
On strategic progress, the digital business returned to growth, booking 15.6% in the quarter. In MTN SA the enterprise business recorded its second quarter of growth and in May we commenced phase 2 of the national roaming agreement with Cell C and look forward to a continued partnership.
In these difficult times we continue to focus on our key priorities: looking after our people, our customers and our networks while we focus on efficiencies. For our people, the immediate priority is their health and safety, where the work-from-home programmes across our markets empower our staff to work remotely while ensuring continuity in our operations. For our customers, we have ramped up our digital channels as a service alternative, to enable them to continue purchasing airtime and accessing our products and services seamlessly as well as launching Y’ello Hope Packages in most of our markets.
Our various initiatives support governments across our markets with communication systems and connectivity as we do our part to help minimise the economic and social impact.
The COVID-19 situation is an evolving one and will undoubtedly impact the year ahead. Given the uncertainties associated with the duration and economic impact of the pandemic, it is difficult to reliably quantify the direct and indirect financial impacts on the business at this early stage. The group will continue to focus on business continuity and efficiency, and we have implemented strict measures to preserve resources and strengthen our resilience.”
Financial Performance
For the first quarter, MTN delivered a solid performance increasing constant currency service revenue by 11,1% and EBITDA by 15,6% with EBITDA margin improving by 2,1pp to 43,2%, in line with medium-term targets. The group recorded voice, data and fintech revenue growth of 6,3%, 26,4% and 26,0% respectively as we continued to execute on our strategic objectives and progress toward becoming a digital operator. Digital revenue has returned to growth, increasing by 15,6%.
MTN Group CFO, Ralph Mupita concluded, “We are encouraged by the service revenue growth of 11.1% which we achieved on a constant currency basis, this translated to 16.5% on a reported basis. Good cost control across the group supported the increase in group EBITDA margins, with a particular strong performance from MTN Ghana. Notwithstanding the impacts of COVID-19 in the first quarter, the balance sheet remained resilient and our cash and committed undrawn facilities was approximately R45 billion at the holding company level, providing us with sufficient liquidity during these uncertain and unprecedented times.
We have experienced a continued surge in data traffic during the month of April, but voice traffic and mobile money transactions were under pressure given various lockdown measures taken across markets. Where lockdown measures have been lifted or relaxed recently, voice recharges and mobile money transaction volumes have improved. For now, we are maintaining our 3 – 5 years medium-term guidance but will update the capital markets in August of any changes when we release our H1 2020 results.”
Looking ahead
The current environment is marked by significant uncertainties. It is still too early to assess the economic impact of the pandemic on our customers and reliably quantify the direct or indirect financial effects on our business. The remainder of the year will be shaped by the ramifications of the pandemic, and we will continue to update all stakeholders as the effects become clearer.
We are not only focused on managing the risks brought about by COVID-19, but also on the opportunities it creates in the accelerated digitalization it has brought about. We believe we are well positioned as a company to benefit from this evolution, especially given our focus on growth in our data, digital and financial services businesses. The Group remains focused on the execution of our BRIGHT strategy to deliver sustainable growth in our operations and value to our stakeholders.
MTN reports commercial momentum, strategic progress and strong financial results; CEO to step down next year, succession process underway
MTN Group today announced an encouraging set of results for the year ended 31 December 2019 and that group president and CEO Rob Shuter would be stepping down from his role at the end of his contract in March 2021.
Commenting on the results, Shuter said:
“In 2019, the 25th anniversary of MTN Group, we delivered commercial momentum across our operations as well as great progress in our strategy and strong financial results, despite challenging trading conditions.
We added 18 million customers to reach a total of 251 million and increased our data users by 17 million to 95 million and our fintech customers by 7 million to 35 million. This growth is central to our belief that everyone deserves the benefits of a modern connected life. We also saw improvements in customer experience, network quality and market share across the group.
On the strategic front, we launched our instant messaging platform Ayoba, which is now live in 12 markets with two million monthly active users. We launched MoMo in South Africa and Afghanistan and received our super-agent licence in Nigeria, registering more than 100 000 agents by year-end. We also delivered R14 billion of asset realisations within the first 12 months of our programme and MTN Nigeria listed on the Nigeria Stock Exchange. We recorded progress on various regulatory issues, including the AGF tax matter in Nigeria. Relationships with stakeholders across our markets improved, and we reported our highest employee sustainable engagement score yet.
On the financial side, we delivered service revenue growth of 9,8% with an acceleration in the second half. Our EBITDA margin improved and reported headline earnings per share grew by 62%. Our network rollout brought a further 69 million people into 4G coverage whilst reducing capex intensity. Improved cash flows during the year supported stable balance sheet ratios.”
Operating environment
This outcome was delivered against challenging macroeconomic conditions, particularly in South Africa, with muted economic activity and the rand weakening against the US dollar.
Financial performance
In constant currency terms, group service revenue increased by 9,8%* to R141,8 billion and earnings before interest, tax, depreciation and amortisation (EBITDA) expanded by 13,6% to R53,4 billion. The holding company leverage ratio improved to 2,2x, which is well within the group’s guidance range of 2,0 to 2,5x, and we reduced our capex intensity to 17,5% from 19,3%, indicating greater efficiency in deploying assets. Driven by the strong earnings performance, operating cashflow increased by 18% and the ROE increased from 11,5% in 2018 to 14,3% in 2019 on an IAS17 basis.
The group’s results were supported by double-digit growth in service revenue by both MTN Nigeria and MTN Ghana. The performance of MTN South Africa was impacted by economic pressure, new data usage rules and changes in recognition criteria for roaming revenue from Cell C due to delayed payments under the networking roaming agreement.
Management succession
MTN announced that the group president and CEO Rob Shuter will be stepping down from his role at the end of his contract in March 2021. The board thanks Rob for the contribution he has made, and continues to make, to MTN. The succession process will be concluded during the year, enabling a seamless handover.
MTN group chief technology and IT officer Charles Molapisi has been appointed to the group executive committee and the fixed contract of the group chief operations officer, Jens Schulte-Bockum, has been extended until 31 March 2022.
Looking ahead, Shuter says:
“We are well positioned for growth. Guided by our well-defined BRIGHT strategy, we are building our growth strategy on our digital operator model while optimising efficiencies, capex and cashflow.
Following data price reductions in South Africa and Nigeria in 2019, we expect price elasticity to improve data revenue growth in 2020, supported by expanded 4G coverage in Nigeria and across the group. We will continue to scale up our fintech and digital services as well as grow our enterprise and wholesale businesses.
We have maintained our service revenue, EBITDA margin, capex intensity and ROE targets and increased our asset disposal target by a further R25 billion over the medium term. We also now target a holding company leverage ratio at below 2x. We will use 2020 to implement our succession process and ensure a seamless handover to the new group president and CEO whilst maintaining our operational execution.
Inspired to harness the pioneering spirit that has built MTN over the last 25 years, we remain committed to delivering on our strategy in a more agile way in close collaboration with our many partners, with whom we are #GoodTogether.”
MTN Ghana (Scancom PLC or MTNGH or the Company) delivered a strong performance for the year in a competitive industry, maintaining market leadership with 55.21% market share. Service revenue increased by 22.8% year-on-year (YoY), underpinned by growth in revenue from voice, data and Mobile Money (MoMo).
Double-digit growth in voice revenue (up 19.4% YoY) was driven by an increase in the number of active subscribers* (+11.2%), the benefits of various customer value management (CVM) initiatives and pro-consumer activity, as well as continued improvements to our network. As new lines of revenue continued to grow much faster than the traditional business, voice revenue’s contribution to service revenue decreased from 46.3% to 45.0%.
Solid data revenue growth (up 32.5% YoY) was attributable to growth in active data users# (+26.6%), growth in the number of smartphones (+18.5%) on the network and an increase in data usage (up 85.9% to 256,301 Terabyte). Data revenue’s contribution to service revenue expanded from 26.3% to 28.4%.
Click here for more details: https://www.mtn.com/investors/shareholders/sens/category-sens/?sens_year=2020
MTN has released a trading statement guiding for growth in its earnings for the year ended 31 December 2019. Headline earnings per share (HEPS) for the period, on pro forma like-for-like IAS basis, is expected to be between 55 – 75% higher. This will result in a range of 522 cents and 590 cents, compared with the HEPS of 337 cents for the prior financial year.
MTN will announce its results on or about Wednesday, 11 March 2020.
https://www.mtn.com/investors/shareholders/sens/category-sens/?sens_year=2020
MTN Group today announced sustained momentum in its results for the 9 months to September 2019 with service revenue growing 9,6% and its EBITDA margin improving by 0,6% to 35,1%. During the quarter the group added 3,5m subscribers and now serves 244 million customers across its 21 markets.
Commenting on the update, MTN Group CEO Rob Shuter said: “Service revenue growth and improvements in our EBITDA margin continued into the third quarter. We remain committed to driving access to internet and financial services and in Q3 we added 4.7 million active data users and 2.2 million Mobile Money subscribers across the portfolio. Our Ayoba messaging platform is now available across five markets and is already recording 515,000 active users per month.”
Overall, solid performances in Nigeria and Ghana offset the headwinds in South Africa, which was impacted by the weaker consumer demand and changes in ICASA’s End User Subscriber Service Charter Regulations which have impacted out-of-bundle (OOB) usage. Notwithstanding these pressures, in the third quarter MTN South Africa saw an improving trend in both prepaid and enterprise service revenues. Consumer post-paid in South Africa remained strong in a competitive market with service revenue growing at 5,8%.
At June 2019 MTN had not recognised R393 million of unpaid revenue from its roaming agreement with Cell C and an impairment of R211 million had also been raised. Since the end of June 2019 to date, Cell C has made payments amounting to nearly R750 million, in line with an agreed payment plan. MTN has continued its conservative accounting for the Cell C roaming contract and only payments receive during the third quarter were processed, and all against the outstanding balances as at June 2019. We continue to work with Cell C on an expanded network deal and are seeing good progress to date.
Providing an update of the asset realisation programme (ARP) MTN Group CFO Ralph Mupita said: “As at June 2019 we had achieved R2.1bn of the 3-year R15 billion target announced in March this year. We continue to make steady progress in this regard and, following American Towers Corporation’s announcement of its acquisition of Eaton Towers, we are in advanced discussions to dispose of our 49% holdings in ATC Ghana and ATC Uganda which we value at between R7bn and R8bn.
The post IPO lock up period of Jumia, in which we have an 18.9% stake has expired and, as at 29 October, this stake is valued at approximately R1.4 billion. We also continue to await regulatory processes for the redemption of MTN Nigeria preference shares that have a value of $315 million for MTN Group. Finally, Econet’s unsolicited offer to acquire our 53% stake in Mascom has been terminated following certain conditions of the sale not being met.”
The Group expects an improved performance in South Africa in 2020 as the effects of the End User regulation on OOB usage moderate, the enterprise division returns to growth and the Cell C situation stabilises. We are confident that in Nigeria we will maintain service revenue and EBITDA growth in line with the medium-term guidance. This will be delivered as we improve our data revenue performance with increased 4G coverage as we utilise our 800 Mhz spectrum. We are also pushing ahead with our mobile money strategy through the super-agent licence, with 66,282 registered agents currently and a target of 100,000 by year end.
Shuter concludes: “Although conditions have been tougher in the year, we have sustained our performance in 2019 and looking forward, we are focussed on executing our BRIGHT strategy to deliver sustainable growth in our operations and to simplify our portfolio to reduce risk and improve returns. We remain resolute and committed to building our digital operator strategy and delivering on our medium-term targets and dividend policy.
MTN Group today announced it has shown encouraging progress under difficult trading conditions. The Group saw growth of 12% in adjusted headline earnings per share, which is the first time that we have delivered growth in this measure in recent years. Commercially, the subscriber base continues to grow, increasing by a further 7,7 million to now number more than 240 million across operations.
Looking forward the Group is well-positioned to grow by leveraging its scale and enhancing its competitive position as it transitions into a digital operator.
Listen to MTN Group President & CEO, Rob Shuter, commenting on the interim results:
MTN is breaking the demographic divide
Increasing access to economic and transactional services for all
Make a big difference in the continent
MTN invested R12 billion in building world-class network
MTN Group today announced an encouraging set of results for the six months ended 30 June 2019 in the context of difficult trading conditions across its major markets.
Commenting on the results, Rob Shuter, MTN Group President and CEO, said:
“We had a good first half, reporting solid financial results, good commercial momentum and encouraging strategic progress. We saw growth of 12% in adjusted headline earnings per share, which is the first time that we have delivered growth in this measure in recent years. Our service revenue grew just below 10% and EBITDA just above 10%, both on a constant currency basis. Our holding company leverage remains stable at 2.3x, well within our guidance range of 2 to 2.5x. And, as we grew revenue and carefully managed our investment programme, we saw capex intensity drop further, to 16,9%.
Commercially, we had strong subscriber growth of 7,7 million in the first six months of the year to reach a total of 240 million subscribers. The number of active data users grew by 3,5 million to 82 million and our 30-day active Mobile Money users grew by 2,4 million to 30 million. Our continued focus on the customer experience has seen us record brand NPSˆ leadership across more than 50% of the portfolio, with 12 markets now leading. That contributed to MTN being named the most valuable South African brand in the Brand Finance South Africa 50 report and the most admired African brand by Brand Africa 100.
During the period we had some landmark events. We successfully completed the listing of MTN Nigeria on the Nigerian Stock Exchange and our e-commerce joint venture Jumia listed on the New York Stock Exchange. Within three months of announcing our asset realisation programme, which is targeting at least R15 billion over the next few years, we delivered R2,1 billion in proceeds.
Our advanced instant messaging platform, Ayoba, is now live in three of our West African markets and has more than 300 000 active monthly users. We are very pleased with the formal approval of our super-agent licence in Nigeria, which clears the way for the launch of phase 1 of our Nigeria fintech business while we await a banking licence.”
Operating environment
In South Africa, the group contended with a weak macroeconomic environment as well as the introduction of new end-user requirements and the repricing of out-of-bundle data rates. In Nigeria, economic activity was muted in the time of presidential elections and prior to the formation of the cabinet. In Iran, the rial weakened sharply after the re-imposition of US sanctions.
Financial performance
Notwithstanding this environment, in constant currency terms, service revenue grew by 9,7% to R67,9 billion and earnings before interest, taxation, depreciation and amortisation (EBITDA) expanded by 10,2% to R31,2 billion. The holding company net debt to EBITDA ratio remained stable at 2.3x, which is well within the group’s guidance range of 2.0 to 2.5x, and capex intensity dropped further to 16.9%, indicating greater efficiency in deploying assets.
Looking ahead, Shuter says:
“MTN is well positioned to grow by leveraging our scale and enhancing our competitive position.
In the second half, in South Africa we will focus on the continued turnaround of the enterprise business, the recovery of prepaid and the launch of Mobile Money. In Nigeria, we will focus on the further rollout of 4G coverage, the launch of Ayoba and Music Time! as well as accelerating our fintech ambitions by fully leveraging our extensive distribution network to offer a range of transfer and payment services to our GSM customer base.
Across the rest of the portfolio we have six focus areas. These are: the continued turnaround of our operations in the West and Central Africa region; the resolution of some of the more complicated regulatory situations; the rollout of MusicTime! and Ayoba across the group; the asset realisation programme; launch of our pan-African MTN 4 Good campaign and delivering on our medium-term targets.”